Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
| |
September 11, 1990 |
| Appeals and Referrals Division |
Technical Publications |
| Ms. L.C. Tremblay |
Division |
| Director |
Technical Review Section |
| |
Bernhard Buetow |
| Attention: James E. Nordin |
(613) 957-9226 |
| |
8-901936 |
| EACC9707 |
Subject: Merton Collin v. The Queen Adverse Decision of the Federal Court - Trial Division
21(1)(b)
It is a fact of economic life that high interest rates bring with them lower property prices (a concept also familiar to those who follow the Stock Market). Demand dries up with the rise in interest rates making it a buyer's market. Buyers are fewer because they cannot afford the financing cost for higher prices be it mortgage interest or margin interest. The cause and effect are instantaneous and dramatic.
24(1) 21(1)(b)
23 Hotline Question 1 of October 31, 1978 states that such a payment is not a selling expense and therefore not a moving expense. IT-178R2 in paragraph 12(e) includes in Eligible Moving Expenses as part of the selling cost in respect of the sale of the old residence mortgage prepayment or discharge fees incurred on the sale. There is no mention of prepayment of a purchaser's mortgage interest and it also specifically excludes expenses for work done to make the property more saleable. 23 21(1)(b)
Bernhard BuetowChief Technical Review SectionTechnical Publications DivisionLegislative Affairs Directorate
BB-GD/hm(76-77) COR "C"
c.c. Roy Shultis
c.c. Bryan Bryson
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© Her Majesty the Queen in Right of Canada, 1990
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© Sa Majesté la Reine du Chef du Canada, 1990
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